BitMEX, Deribit adopt Shyft Network for FATF ‘Travel Rule’ dilemma

August 17, 2021
Cryptocurrency compliance platform Shyft has gained two more major exchanges, BitMEX and Deribit, as it begins a phased deployment of its decentralized approach to anti-money laundering rules from the Financial Action Task Force (FATF), according to Yahoo Finance.

The solution known as Veriscope, which uses blockchain smart contracts to identify exchange addresses and privately share know-your-customer (KYC) data, is also collaborating with Binance, Bitfinex, Tether, Huobi and 30 or so other virtual asset service providers (VASPs).

The FATF’s “Travel Rule” guidance requires that financial services firms, including VASPs, exchange personally identifiable information (PII) about customers sending and receiving funds over a certain amount in a bid to counter money laundering and terrorist financing.

There are a number of approaches to solving the “Travel Rule” for pseudonymous-by-design cryptocurrency transactions: some are focused on one region or jurisdiction, some use centralized databases.

Shyft is focused on using smart contracts to create a global attestation layer. Around a year and a half ago, the network formed a governance group and task force, which included around 20 exchanges, and which was chaired by Rick McDonell, former executive secretary to the FATF.

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